The Corner

Health Care

A New Blueprint for Conservative Health Reform

A sign on an insurance store advertises Obamacare in San Ysidro, San Diego, California, October 26, 2017. (Mike Blake/Reuters)

You can read it here, from the Health Policy Consensus Group, which is made up of numerous high-caliber right-of-center health wonks.

I’m still digesting the technical details, and expert commentary should trickle out over the next couple days. But here’s my initial takeaway: The failure to pass health reform was rather embarrassing, and Congress is going to be really hesitant to go down this path again, at least until the midterms. (Things will look a lot better if Republicans gain seats in the Senate.) To revive the effort before then, this report needed to propose a magic bullet capable of converting GOP skeptics such as Rand Paul, John McCain, Lisa Murkowski, and Susan Collins. And I’m not sure there’s a magic bullet here.

Broadly speaking, this is similar to the Graham-Cassidy bill, minus the attempt to cap spending on traditional Medicaid, and with a more aggressive expansion of health savings accounts. Obamacare’s funding would be turned over to the states, which would have considerable latitude to set up their own health-care systems, free of Obamacare’s various regulations. Individuals would also be free to buy a private plan instead of enrolling in a public program. It’s a fine idea, but something quite like it flopped in Congress already, and the GOP has lost a senator since then.

And as I noted in a post last month when a summary of the plan leaked, one major issue with Graham-Cassidy was how it treated states that did and didn’t expand Medicaid. Under the status quo, expansion states get a lot more money. But there’s no reason to lock in a permanent financial bonus for states that chose to expand — especially for Republicans, who think expansion was the wrong choice — so a reform bill needs to equalize the funding over time. Unless total funding increases, however, this means that expansion states will see funding cuts while non-expansion states get a boost. That’s what Graham-Cassidy did, and unsurprisingly, some Republicans representing expansion states were not crazy about it.

There were noises that the group had somehow solved this problem, but the new document offers only vague wording that’s similar to Graham-Cassidy’s own approach: “Initially, the grants would be based on the amount of ACA spending as of a fixed date. Over time, the grant would be based on a state’s number of low-income residents.” No actual funding formula is provided, so a dubious member of Congress can’t even tell how much better or worse off his state would become. Like the new proposal in general, it’s a perfectly fine policy idea, but it’s hard to see how it solves the political problems that hurt Graham-Cassidy.

Maybe something about this proposal will woo reticent Republican senators, making it worthwhile to take another stab at health reform before the midterms. But it sure seems like a long shot.

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